So interest rate went up…by about a half a point. A pretty decent increase. The question has been posed this week…will this have an effect on slowing the market down? I think that’s a good question and based on my own activity this week I think it has. Of course I also think that will last another couple of weeks and then it’ll be full steam ahead.
Why do I think that? Because rents aren’t going down and if you think this will mean prices will fall 24% in the next few months…get over it. They won’t. A few people I spoke to think rates could go up over 5% by the end of the year. If that becomes clear don’t you suspect folks will be more serious about buying before that happens? We’ve had a long period of low rates. I think this increase shocked some people but those same people will rediscover their motivation to buy in the not too distant future. Simply because all those reasons they had to buy before are still there.
I do think this week will provide a very nice opportunity to get a bargain though…if you can really use the word bargain for this market. I think you may be able to not compete to compete with a lot less people. If I was a buyer I’d be writing soon…because folks got nervous and that nervousness won’t last long.